Hellerstein v. Assessor of Town of Islip

• Decision Date: 05 June 1975
• Citation: 37 N.Y.2d 1,371 N.Y.S.2d 388,332 N.E.2d 279
• Parties: , 332 N.E.2d 279 In the Matter of Pauline HELLERSTEIN, Appellant, v. ASSESSOR OF the TOWN OF ISLIP, Respondent.
• Court: New York Court of Appeals Court of Appeals

Page 388

371 N.Y.S.2d 388

37 N.Y.2d 1, 332 N.E.2d 279

In the Matter of Pauline HELLERSTEIN, Appellant, v. ASSESSOR OF the TOWN OF ISLIP, Respondent.

Court of Appeals of New York.

June 5, 1975.

Jerome R. Hellerstein, New York City, for appellant.

Francis G. Caldeira, Town Atty. (Ernest J. Cannava, of counsel), for respondent.

WACHTLER, Judge.

Petitioner, an owner of real property located on Fire Island, claims that the entire assessment roll for the Town of Islip is void. The argument has been raised in a proceeding instituted pursuant to article 7 of the Real Property Tax Law Consol.Laws, c. 50a, which permits court review of an assessment upon a complaint of illegality, overvaluation or inequality (see Real Property Tax Law, § 706). There is no claim of overvaluation or unequal treatment in the assessment of petitioner's property. She argues only that the assessments are illegal because they were not made in accordance with section 306 of the Real Property Tax Law which states: 'All real property in each assessing unit shall be assessed at the full value thereof.' This, we have held, means market value, unless that cannot be established 'and then other tests of full value must be used.' (People ex rel. Parklin Operating Corp. v. Miller, 287 N.Y. 126, 129, 38 N.E.2d 465, 466.) Here it is conceded that all assessments throughout the township are based on a Percentage of market value.

The Supreme Court, Suffolk County, in an opinion, dismissed the petition. The Appellate Division, Second Department, affirmed, without opinion. Justices Hopkins and Latham concurred on constraint of McAlevey v. Williams, 41 A.D.2d 971, 344 N.Y.S.2d 193 but cited cases from other States in which the highest court has held that 'full value', or similar language, prohibits fractional assessments. The case has come to our court by leave of the Appellate Division.

Section 306 of the Real Property Tax Law has an ancient lineage. In 1788 the New York Legislature directed 'the assessors of each respective city, town and place in every county of this State (to) make out a true and exact list of the names of all the freeholders and inhabitants and opposite the name of every such person shall set down the real value of all his or her whole estate real and personal as near as they can discover the same'. (See L.1788, ch. 65, March 7, 1788.) In 1801 the standard was changed to 'just and true value' (L.1801, ch. 179, § 1, April 8, 1801) and in 1823 was altered again to read as follows: 'all real and personal property shall be valued by the assessors for the purpose of taxation, at the value they would appraise such eatate in payment of a bona fide debt due from a solvent debtor'. (L.1823, ch. 262, § V, 'All property to be assessed at its cash value.') The term 'full value' first appeared in a draft revision of 1826--1828 providing that 'All real and personal estate liable to taxation, the value of which shall not have been specified by affidavit of the person taxed, shall be estimated by the assessor at its full value, as they would themselves be willing to receive the same in payment of a just debt due from a solvent debtor; but in the valuation of real estate, the term, 'solvent debtor,' shall be construed to mean a debtor who is capable of paying all his debts, withot resort to the land to be valued.' (Report of the Commissioners to Revise the Statute Laws of 1826--1828, ch. XIII, tit. II, art. 2, § 16, 'Of the manner in which assessments are to be made'.) This proposal was enacted into law in 1829 after the Legislature deleted the last clause beginning with the words 'but in the valuation of real estate' (N.Y. Rev.Stat.1829, vol. I, ch. XIII, § 17, p. 393; see, also, L.1896, ch. 908, § 21, subd. 3; Cons.Laws of 1909, ch. 62; L.1933, ch. 470, § 18).

Although the statute is one of the oldest in the State there does not appear to be any extant legislative history indicating what the full value requirement was intended to accomplish. And despite the fact that the custom of fractional assessments appears to be at least as old as the statute (see Kilmer, Legal Requirements for Equality in Tax Assessments, 25 Albany L.Rev. 203, 210), it has prompted very little litigation. In several of the older cases the problem can be seen lurking in the background; but it is only during the last 10 years that we find the practice being directly challenged in the courts.

It appears the first case touching this point surfaced in our court in 1852 (Van Rensselaer v. Witbeck, 7 N.Y. 517, 522). At issue there was the validity of an assessment certificate which differed from the statutory form in certain respects which we found to be material. 'The assessors have taken the precaution to negative all presumption that they had done their duty, by certifying that they had estimated the real estate, not according to its value, 'but as they deemed proper,' and the personal, not 'according to their best information and belief, of its value,' but 'according to the usual way of assessing.' We are infomed by the learned judge who delivered the opinion of the supreme court, that the usual method is to estimate property at less than half its value, under the obligation of an official oath, which requires its full value to be stated; If this be so, the practice should be corrected. In the second place, these proceedings show the importance of adhering to the law, since these assessors, if the surmise of the learned judge is well founded, though prepared to violate their duty and their oath of office, shrunk from testifying to a gross falsehood, to be recorded under their signatures.'

In People ex rel. Board of Supervisors v. Fowler, 55 N.Y. 252, 254, the supervisors of Westchester County sought a writ of mandamus, compelling the assessors of the Town of Rye to file a proper certificate of assessment. Once again, the problem arose because of fractional assessments and, although 21 years had elapsed since the Witbeck decision, out attitude toward the custom had not changed.

'The affidavit of the defendant Purdy, one of the assessors of the town of Rye (shows) that it had been the custom, for several years, of the assessors of that town, in making the assessment roll, not to enter therein the valuation of real estate at its full value, or at the true or full value at which the assessors would appraise it in payment of a just debt due from a solvent debtor, but to insert the value at about one-third, or in some cases one-fourth the full and true value, and at one-third or one-fourth the sum at which they would appraise it in payment of a just debt from a solvent debtor, and that this was the plan or basis upon which the assessment roll of 1871 was made. The affidavit of the defendant Fowler, also one of the assessors, contains substantially the same statements, and the additional one that, in view of the practice * * * no other basis of assessment could be adopted 'in justice and fairness to the town of Rye.' There was no contradiction of these affidavits, and the fact stands unchallenged upon the statements of the assessors themselves, that, in making their assessment, they deliberately violated the statu and their official oath for the purpose of doing 'justice to the town of Rye.'

'The assessors made and subscribed an oath, annexed to the roll, in which they stated that, in making the assessment roll, they had estimated the value of the real estate therein at the sums which a majority of the assessors Had decided was its full and true value, but they omitted to state that the valuations were those 'at which they would appraise the same in payment of a just debt due to a solvent debtor.' The mandamus was sought to compel them to add the omitted clause to their affidavit. They, in answer, allege that they could not truthfully swear to that statement. This answer is conclusive. Courts do not sit to compel men to take false oaths, and whatever duty the assessors may have omitted, they owe no duty to the public to commit crime, and no public exigency can require it of them.' (Emphasis in original.)

The same type of criticism is found in a 1907 Third Department case (People ex rel. Congress Hall v. Ouderkirk, 120 App.Div. 650, 105 N.Y.S. 134). After affirming a determination, reducing the taxpayer's assessment to the percentage prevailing in the taxing unit, Justice Cochrane, speaking for the court, stated (pp. 654--655, 105 N.Y.S. pp. 137--138): 'This is an opportune time to comment on the custom, much too prevalent among assessors, of assessing real estate at less than its full value, in direct violation of the statute. Not only do assessors in following such custom violate their official duties, but consciously, or unconsciously, they swear to an untruth, when in the verification of the assessment roll, which is required, they make oath that they 'have estimated the value of the said real estate at the sums which a majority of the assessors have decided to be the full value thereof.' Tax Law, § 37. This case is a startling commentary on either the incompetency or willful official dereliction of the assessors. Having first verified their assessment roll wherein they made oath that they had estimated the value of the real estate at the sums which a majority of them decided to be the full value thereof, they proceeded to establish the falsity of such oath by proving the valuations to be far in excess of the assessments. They called different witnesses before the referee, who testified that not merely in exceptional instances, but that as a general rule, the actual value of the property inquired about was nearly or quite double the amount for which it was assessed. The assessors seem to have considered their violation of law of no consequence, provided only in making the various assessments they violated it impartially. The referee specified in his report numerous parcels of real estate in reference to which the total assessed valuation was less than one-half the...